Signa Loans Hypo Balance Sheet Cloud – vorarlberg.ORF.at

Michel Haller, CEO of Hypo itself, said that the business figures for 2023 represented a “good operating result”, due in particular to net interest income of €233.7 million (2022: 167.8 million). The result was burdened by €78 million of risk provisions, which particularly reflects Signa's potential defaults. The bank's strategy was correct, and this was confirmed on Friday.

Hypo defends companies outside Vorarlberg

Hypo operates 15 branches in Vorarlberg, but is also active in major Austrian cities and in St. Gallen. Hypo's commitment outside Vorarlberg has been criticized in particular regarding Signa's financing – there is around €130 million that Hypo could lose as a result.

However, Haller pointed out that only 40 percent of business is done in Vorarlberg. The growth achieved in recent years has only been possible on the basis of supraregional regions. Aman stressed the balance of the business model. If one area is not performing well, another will pick up the slack.

Six out of seven Signa loans are likely to default

When it comes to Signa, all possible steps are examined, as Haller emphasizes: “We register all claims in the proceedings and check whether it is possible to take legal action against individuals.” Of the seven loans with Signa Group, six of them were assessed as distressed, three of which, however, are not currently insolvent and are servicing their loans.

The bank is particularly suffering from a loan to the private foundation Banco worth 47.3 million euros, in which a ten percent stake in the company was accepted as collateral – which has lost much of its value. Haller also noted that “it was a different world back then, and the loan decision was well justified at the time it was granted.”

Hypo changes risk strategy

In response to the transactions with Signa Group, Hypo Vorarlberg has now adjusted its risk strategy in agreement with the Supervisory Board. Maximum limits have been set, and it is no longer possible to award more than €140 million to a client.

“In the zone of tension between risk and return, we are taking back some risk,” Haller said. Operationally, the CEO said the year has been “going well so far.” However, credit growth remains modest.